On April 29, 2015, the UC Berkeley Golden Bears eSports team
beat Arizona State to win the collegiate video gaming championship
tournament. The winners received their remaining years'
tuition, and if they were graduating seniors, they received a
year's worth of tuition in cash. The contest was sponsored by
Blizzard Entertainment, a video game developer whose "Heroes
of the Storm" game, which was used in the competition, is
scheduled to be released this month. The most notable
"milestone" was that the game was broadcast live on
ESPN2.
In July 2014 a similar contest featuring the game "Dota
2" was held in a Seattle basketball arena crammed with 11,000
screaming spectators. The contestants were playing for $11 million
in total prize money and, according to The New York Times,
"moved another step closer to securing [social] gaming's
legitimacy as a major-league spectator sport." The October
2014 "League of Legends" tournament that was held in
Seoul, Korea's soccer stadium was sold out with 40,000 fans in
attendance, another indicator of the rabid devotion to this form of
entertainment.
"Global revenue for games is $20 billion higher than the music
industry's and is chasing that of the movie business,"
says Nick Wingfield, a writer for The New York Times, and
"this fall [2014], Robert Morris University in Chicago will
dole out over $500,000 in athletic scholarships to gamers." He
added, "More than 70 million people worldwide watch e-sports
over the Internet or on TVs, according to estimates by SuperData
Research."
The Las Vegas Convention and Visitors Authority ("LVCVA")
recently released its year-end statistics that showed over 41
million visitors came to Las Vegas in 2014, a new record! However,
there were also a few notable trends in the 2014 "Las Vegas
Visitor Profile" conducted by my friends at GLS Research in
San Francisco, a company which prepares the annual report for the
LVCVA. Their in-person interviews of 3,600 visitors per month
revealed that 19% of the interviewees stated that this was their
first trip to Las Vegas, and 47% of all visitors said their primary
reason for visiting Las Vegas was vacation or pleasure, up
significantly from 41% last year. Of the new visitors, 69% said
they came primarily for either vacation or pleasure. However, the
most surprising, or perhaps disconcerting, statistic was that only
12% of the visitors said they came primarily to gamble!
These two stories are not disparate. Combine them with the recent
successes of fantasy sports and we can plainly see the preference
of both the millennials and Gen-Xers to a more varied, interactive,
and challenging form of gaming entertainment. This is surely a
"sea change," but the dilemma for legalized gaming is to
find a way to monetize the phenomenon. The Nevada Legislature
recently passed SB 9, which was hurriedly signed into law by the
Governor. The preamble to the Bill states, "the continued
growth and success of the gaming industry in the State of Nevada
depends on the fostering of a business and regulatory environment
that promotes continued advances in the use of technology in
gaming, which improves the entertainment experience, encourages
innovation and supports expansion of the domestic technology sector
of the economy of this State."
In sum, the Legislature has directed the Nevada Gaming Commission
to adopt regulations that encourage manufacturers to deploy gaming
devices that differentiate requirements for outcomes of a game of
skill, a game of chance, and a hybrid game. To accomplish this,
greater flexibility must be allowed in payout percentages. The
Commission was also asked to provide guidelines for some type of
integration of social networking technologies so that players
enrolled in interactive mediums could engage in games supported by
networked servers.
Dickinson Wright's gaming lawyers are poised to represent game
manufacturers, developers, and other ancillary businesses who need
access to the casino and resort industry or whose products may
require regulatory review.
Nevada is leading the way in addressing the interests of the next
generation of gamers. In the Nevada office, Greg Gemignani, whose
prior work history included six years as a systems engineer and
architect, is an accomplished gaming law attorney who has an
extensive background in Intellectual Property and Technology Law.
Kate Lowenhar-Fisher has a wealth of experience advising clients on
issues related to Internet gaming, social gaming, fantasy sports,
and sweepstakes and is deeply engaged in those
"ancillary" activities that bring people to Las Vegas
– namely, spectacular nightclubs, restaurants, conventions,
and hotels. Jennifer Gaynor, who leads the firm's Nevada
government relations practice and has been following the
development of Senate Bill 9 in Carson City, provides gaming
clients with legislative and regulatory assistance. Finally, I am
proud to have recently joined the Gaming Practice Group to provide
the continuity, contacts, and institutional knowledge for both the
new era of emerging game development as well as the evolving
entertainment sector of the resort industry.
The next generation of gamers and their impact on the entertainment
world is not limited to Nevada. It is a worldwide development
composed of traditional casino games, sports betting, fantasy
sports, skill games, and new and exciting competitive creations
that test the line between games of chance and games of skill on a
daily basis in both land-based casinos and on the Internet.
Particularly compelling is the reality that the Internet has broken
down traditional borders and generated a vast array of disparate
regulatory and statutory environments. With the dramatic expansion
of international companies entering the gaming/entertainment market
in a variety of ways, all of which are heavily licensed and
regulated, a broad and detailed understanding of these complexities
is of paramount importance to industry participants. A violation in
one jurisdiction can trigger penalties and loss of licenses in
other jurisdictions in what can easily become a domino effect if
not dealt with properly.
The strength of the Dickinson Wright gaming law practice is founded
on the expertise and depth of its Gaming Practice Group. Led by Bob
Stocker in the Lansing office, Michael Lipton in Toronto, Dennis
Whittlesey in Washington, and Glenn Feldman in Phoenix, the group
has been in the forefront of all sectors in the gaming industry,
including regulatory, compliance, ownership, licensing,
immigration, intellectual property, labor, tax, and general
business matters. The strength of the Gaming Practice Group is
reinforced by Dickinson Wright's offices in six states, the
District of Columbia, and Canada; lawyers licensed to practice in a
number of major gaming jurisdictions; recognition by Chambers
Global of Michael Lipton and Bob Stocker as Band 1 gaming
specialists; recognition by Chambers USA of Jeff Silver and Bob
Stocker as Band 1 gaming specialists and of Kate Lowenhar-Fisher as
an Up and Coming gaming law practitioner in Nevada; Dennis
Whittlesey's and Glenn Feldman's involvement in the $28
billion American Indian gaming industry since its inception in the
1980s; relationships in Macau, Malta, Peru, and the Balkans; and
the Gaming Practice Group's 30 plus members' representation
of gaming companies, gaming vendors, and related elements of the
hospitality industry. Overall, Dickinson Wright is unique in that
there is a substantial body of fundamental "how to"
knowledge within the Gaming Practice Group and other relevant
practice specialties on all issues impacting the gaming and related
entertainment businesses.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.